thoughts, page-6

First 6 Last

Share
Profile

Follow
saintex

4,442 Posts.

474

03/03/24

12:05

Post #: 72717846
Share

Originally posted by thebarry111: ↑

Going through the prospectus is almost useless at this point.

You need to understand the history of the company to paint a better picture.

Before acquiring ARMA and Oakbridge lawyers on Feb 2022 the company was struggling to gain traction - its fair to say it probably wouldn’t still be around if it didn’t happen.

The company was solely Digital based and this offering alone wasn’t working.

They have spent a lot of time transforming the existing ARMA book to digital - I would say it’s close to 80% digital at this point.

This has laid a platform for revenue that will fund the business going forward.

They have under 10% of the addressable Australian market so there is a massive runway there.

From a margin perspective Andrew recently stated that $0.55 of every new dollar falls through to the bottom line, so from here on out the margins will improve substantially.

The above helps to explain the slow growth, but the other part is the onboarding. It seems to have taken an eternity for it to come through, but the onboarding process was slow. The upside to that though is when the revenue does come through it should be sticky (early days but they have stated they haven’t lost a tier 1 client).

As the technology is proven and results are coming through they are winning a larger amount of work from the panel.
It is at this point where they can cross sell to gain further traction.

The real future driver - and why I am here is if they are successful in deploying their AI technology with third party providers on an international scale.

I think the FY24 presentation actually does a really good job of painting the picture.

It’s been a really slow burn, but those coming on now are jumping on at an exciting time. I still think even that upgrade was conservative and they are likely to upgrade further this financial year.

They have learnt from past mistakes and want to be conservative and over deliver to the market.

Expand

One of the element they mention : they have a better debt collection than their peers.
So far, I have not seen clear evidence of that (I have not been through all their presentations).
Did you get any figure about this ?

CCR Price at posting: 27.5¢ Sentiment: Buy Disclosure: Held
Upvote

0 Great analysis

Reply

Top Stories

IRX

InhaleRX snags $38.5M in funding from VC biotech funder Clendon

SNX

Sierra Nevada raises $2M for silver exploration at Blackhawk

MTH

Mithril's drilling in Mexico picks up silver at 997g/t, gold at 28g/t

NVU

Nanoveu surges 10% after benchmark testing for new AI chip begins

TLG

Talga Group wins key permit for flagship graphite mine in Sweden

MKT

The ASX can overlook its Telecomm small-caps. Here’s one diversified brand with an international footprint

SWP

Swoop lobs $18M offer at microcap telecom Vonex – in which it holds 19.9%

What's causing the cost-of-living crisis, and how to navigate it

M4M

Macro, Norden set up transport solutions initiative for West Pilbara

Week 42 Wrap: HotCopper's top picks; new ASX 200 record; world yawns at war